The Court of Appeal has recently handed down Judgment in a proprietary estoppel case concerning a farming family.

The case of Moore v Moore [2018] concerned a claim made by Stephen Moore (who was a farmer) against his father Roger Moore. Stephen had grown up working on the family farm known as Manor Farm in Wiltshire. Manor Farm was inherited by Roger Moore and his brother Geoffrey Moore (Stephen’s uncle) in 1996. Geoffrey and Roger had formed a partnership and built a successful farming business together with the help of Stephen who had started working on the farm from a very young age.

Stephen became an equity partner of the farming business in 2003 alongside his father and his uncle. Geoffrey subsequently retired from the partnership and gave his share of the business to Stephen, at a loss, in exchange for a payment of £500,000 from the partnership.

In 2008, Roger started showing signs of dementia and he was forced to take a step back in the business, much to his frustration. Roger felt pushed out and the relationship between the father and son broke down. Roger purported to dissolve the partnership in 2012 which was contested by Stephen. Roger then issued court proceedings for a declaration that the partnership had indeed dissolved. Stephen contested the proceedings and counterclaimed on the basis of proprietary estoppel.

Stephen said that he relied upon promises made by Roger that Stephen would inherit his share of the farming business to his detriment. Stephen’s detrimental reliance included the fact that he had been dedicated to the family farming business and accordingly that he had not pursued other careers. He also said he had not received enough income from the partnership to build up any capital or assets of his own.

The 2016 High Court decision

Mr Simon Monty QC, who was sitting as a High Court Judge allowed Stephen’s claim and held that Stephen indeed had an “equitable interest in Roger’s share of the farm and the farm assets, to include the current and capital accounts, Roger’s share of the company cash/profits and Roger’s director’s loan account”. Monty J also ordered the dissolution of the partnership but allowed for Roger and his wife to continue living at the farm and for them to receive a regular income from the farming business.

Roger’s wife Pamela appealed the decision on Roger’s behalf, as his litigation friend. Roger had been admitted into a care home and had lost capacity by this point. The appeal cited a number of grounds which included an attack on how the original judge had exercised his discretion as to how to satisfy the equity in this case. In particular, Pamela argued that the Judge had granted relief that was “"disproportionate and far greater than the minimum necessary to do justice". Pamela also argued that the Judge by ordering the immediate transfer of the farm and partnership assets to Stephen had provided more than what Stephen had even sought in his pleadings. In addition, she said that the order deprived Roger and Pamela of their independence and prevented them from buying accommodation away from the farm in the future if they so wished.

The Judge allowed Pamela’s appeal and agreed that Monty J had overstepped the mark when considering the order that was needed to satisfy the equity in this case. The judge commented that this dispute had gone on for a number of years and that it was therefore not in the parties’ best interests to remain financially dependent upon each other (which was the effect of the 2016 High Court decision). The Judge also agreed that Monty J had accelerated Stephen’s inheritance and had not taken into account Pamela’s financial needs after Roger’s death. The Judge ruled in favour of a clean break between the parties and suggested that a lump sum would need to be paid to Pamela in the region of between £1-2 million but confirmed that the exact figure would need to be determined at a further hearing.

Our contentious probate solicitors say that “Moore v Moore 2018 is unusual in that the proprietary estoppel claim was brought within the promisor’s lifetime. Proprietary estoppel claims more frequently arise in the context of an inheritance dispute or as part of a contentious probate dispute”